AT&T: Tough to Go With the Flow

AT&T looks a bit pressed for cash. The company surprised analysts late Tuesday when it said it would generate free cash flow of around $11 billion in 2014, far short of the $15.5 billion Wall Street projected. With roughly $9.7 billion of dividends due to be paid out of that sum, AT&T is left with little room for error even as competition in U.S. wireless is intensifying.

The primary reason for the shortfall: an expected increase of up to $3 billion in cash taxes this year. AT&T also plans capital expenditure...